The epic bubble in the South Florida real estate market is in the process of bursting. Call it what you want, but the party is over. Today’s charts illustrate how prices, transaction volume and real estate inventory are all pointing toward a correction in the South Florida real estate market. The first chart shows how the average selling prices of houses and condos in Miami, Fort Lauderdale and Palm Beach have declined substantially from the peak. We have mentioned in our prior market outlooks that prices for single-family homes in the tri-county area of Miami, Fort Lauderdale and Palm Beach peaked in June 2022. At that point, the average selling price was $1,019,037. In November, the average selling price has declined 19% from the high, dropping to $826,370. Condo prices reached their peak of $563,545 in May 2022, but haven’t declined as much since then. In November, the average selling price of a condo was $481,205, representing a 15% decline off the highs.
There has been an epic decline in residential transaction volume. The peak in sales volume looks like it was back in June of 2021 when there were 6,746 houses and 5,462 condos sold across South Florida for a total of 12,208 closed transactions. In November, there were only 5,357 transactions, representing a massive 56% decline in total sales. For that month, there were 2,848 houses and 2,509 condos sold. Here is a quick look at the monthly average of transactions over the last decade:
What could drive transaction volume over the next several months? Inventory is starting to climb back from the lows. Residential inventory hit rock bottom in March of 2022, with only 14,517 properties on the market. Since then, inventory has climbed 84% to 26,769 properties available for sale in South Florida. That number is comprised of 12,432 houses and 14,337 condos. With more inventory, transaction volume should gradually improve, as long as there are buyers that can afford to purchase in this market and get property insurance!
This real estate market outlook covers real estate activity in Miami-Dade, Broward and Palm Beach County, Florida. Here are just a few of the cities in each of these three markets:
- Miami-Dade – Aventura, Coral Gables, Miami Beach, Hialeah, Sunny Isles Beach, North Miami, Homestead, Doral, Miami Lakes, Downtown Miami, Brickell and Key Biscayne.
- Broward – Fort Lauderdale, Pompano Beach, Deerfield Beach, Hollywood, Hallandale, Weston, Parkland, Wilton Manors, Oakland Park, Plantation, Cooper City, Davie, Coral Springs, Sea Ranch Lakes, Lauderdale by the Sea and Lighthouse Point.
- Palm Beach – Delray Beach, Highland Beach, Jupiter, Palm Beach Island, Boynton Beach, Boca Raton, Highland Beach, Palm Beach Gardens, West Palm Beach, Wellington and Lake Worth.